Compliance 101

SOC 2 vs. ISO 27001: Which Framework is Best for My Business?

SOC 2 vs ISO 27001

“Should we go for a SOC 2 or an ISO 27001?”

This is one of the most common questions we hear from founders as they map out their compliance needs. Understandably so, as the SOC 2 vs. ISO 27001 debate compares two of the most popular (and most overlapping) compliance frameworks out there.

Both frameworks test your information security controls and provide reassurance to your customers that their information is safe in your hands. Yet they differ in two important ways that often make the decision easier for founders.

Read on to learn which framework is better for your business, and why we rarely recommend startups in the US begin with an ISO 27001 certification.

SOC 2 vs. ISO 27001: What’s the Difference?

A lot of little differences set SOC 2 and ISO 27001 apart, such as who conducts the audits, what kind of report or certification you receive, and the frequency of the audit cycle. However, there are two main framework differences that will most likely impact your decision: market applicability and scope.

Market Traction for SOC 2 and ISO 27001

At the moment, SOC 2 dominates the U.S. market. ISO 27001, on the other hand, is the international favorite, particularly in Europe.
So, even though industries across the globe recognize both frameworks, you’re more likely to choose one or the other based on the location of your operations and who you work with.
In general, U.S. companies, particularly enterprises, prefer their vendors have a SOC 2 in place before working with the company. International companies lean toward ISO 27001, which is also better suited for integrating ISO 27701 and the General Data Protection Regulation (GDPR) in Europe.

Scope for SOC 2 and ISO 27001

Even though both frameworks share many of the same topics and controls, they differ in what they recommend.

SOC 2 takes a more flexible approach. This framework measures the design and operating effectiveness of your controls based on five Trust Services Categories (TSC): security, availability, confidentiality, privacy, and processing integrity. However, only one of the TSCs is mandatory (security) and the remainder of the categories may be applicable depending on your commitments to your customers. You should discuss with your auditors and compliance team which TSCs to include in your SOC 2 report.

While SOC 2 presents the trust services criteria and allows you to choose the controls to meet the trust services criteria, ISO 27001 is much more prescriptive. This makes it more challenging to fulfill the requirements, but it’s clearer on what you need to accomplish to achieve certification.

For a look at the other differences between the two frameworks, check out this chart:

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So, Should I Choose SOC 2 or ISO 27001 for My Startup?

We recommend going the SOC 2 route for most U.S. companies, particularly SaaS startups. SOC 2 is the current standard for domestic operations, but if your business is majority-based internationally or targets international customers, you should pursue ISO 27001.

If you’re still unsure, reach out and we’ll walk through your business’ needs to find the best solution.

For more information on different frameworks, check out our overview of the most common compliance frameworks for startup founders.

Ready to dive into SOC 2? Get a head start with our in-depth guide to SOC 2 compliance.